Smartphone manufacturers might face component shortages in 2017

Considering the rise of China-based smartphone manufacturers, the industry might find itself in a tough situation this year, as demand climbs for key smartphone components, including displays, memories and optical sensors. According to Digitimes, this information is backed up by sources from supply chains in Taiwan.

According to the rumors, the attempts by Chinese companies to increase their global presence forces them to produce more mid-range and high-end devices. This requires them to order more components, which significantly increases the demand.

Apple and Samsung are expected to be the top 2 smartphone vendors globally in 2017, just like the past few years. However, Huawei, Oppo and Vivo, all three of which are based in China, will be duking it out for the next three spots in the list. According to Digitimes, Huawei might scale its shipments to over 150 million units this year, compared to 2016's 139 million, and Vivo might be shooting to ship over 100 million devices in 2017.

In order to keep up with the leading handset manufacturers in the country, smaller China-based brands have moved on to mid-range and high-end devices. Most of them follow the same philosophy – to provide high end specs for the lowest price possible. That's the same strategy that gave Huawei and OnePlus some traction on the Western markets last year.

In an attempt to keep up with the trends, Chinese companies are also looking into securing supplies for OLED displays. Considering that OLED displays were of short supply last year as well, this could really drive demand up through the roof.

TFT LCD displays will also remain in high demand, as mainstream smartphone models move from 5” screens to the bigger 5.5” and 5.7”. Optical sensors, including camera modules, are also expected to be in short supply, as more manufacturers focus on delivering the best camera performance possible.

source: Digitimes